Business World, 21 July 2014


Future historians will ponder the curious chain of events that provoked profound political changes in the Philippines under Aquino III. The puzzle for them is to understand how formal rules came to be taken seriously and suddenly made to “stick.” From public outrage over the uncovered Napoles mafia, to the Supreme Court’s proscription of congressional pork barrel, down to its latest decision against the President’s power to reallocate funds — the rules of political behavior and engagement are being fundamentally changed.

On the surface, the effect is as if one was simply “restoring” order in the relations among the branches of government as intended under the Constitution. After all, Congress is supposed to have the “power over the purse,” and the President’s job is simply to implement legislative priorities. Hence, legislators should not select projects to implement ex post, and the President should not independently appropriate and allocate monies without explicit congressional approval. All neat and bundled, right?

Except, of course, the Philippine government has never functioned that way. Legislative pork has always existed under different names in all post-Marcos administrations and instituted in its current form under Cory Aquino’s budget ministry (a well-intended innovation by my colleague Ben Diokno). What’s more, until this year, this practice was twice rubber-stamped by the Supreme Court. On the other hand, all presidents, even under the present Constitution, have always effectively picked and chosen budgetary priorities. Especially when a fiscal crisis required deficits to be controlled, the President always decided which budget items should continue to be funded and which were to be abandoned, effectively performing the function of the legislature. Or then again through a re-enactment of the budget (which can be contrived by not passing a new one), the President disposed over all the funds artificially “saved” from already completed projects and was free to define new priorities. The Disbursement Acceleration Program (DAP) was nothing new, from this viewpoint.

All in all, therefore, Philippine democracy has functioned up to now with an “imperial presidency.”

Which brings us to the point: if the Supreme Court is right about what the spirit and letter of the law say, why has practice deviated from it?

It is rooted in the fact that there are no long-lived organizations (read: political parties) capable of formulating national agendas and defining national priorities. In practice, only the President, controlling the large bureaucracy, can do that. It is then natural for the strategic function to devolve on him.

In the meantime, with their re-election based on local-level patronage, the focus of legislators’ attention is primarily parochial. Their function is reduced to that of fiscal brokers seeking to ensure their share of the national pie. This makes them uninterested in their responsibility for their theoretical “power over the purse” (except for the odd occasion it can be used to extort concessions from the executive). In current practice, for example, Congress hardly even knows how much “the purse” contains: laws are enacted without the funding needed to implement them; budgets are passed without legislative regard for expected tax revenues, or the debt burden, or the resulting size of the budget deficit — all those things are passed on to the executive. (Let him worry about it; I just need my convention center.) This, of course, is a flawed, imperfect order; yet it is order nonetheless — serviceable in the case of a good president, though a free ticket to abuse by a bad one.

Which brings us to the current pass. If, as expected, the Court reaffirms its decision on the DAP, then — together with the abolition of “pork” as we knew it — how shall Congress and the Executive henceforth relate to each other? On the one hand, the institutional dissonance will seem to have been resolved: government is then constrained to function more closely to what the Constitution envisions. On the other hand, one must ask whether political actors (not ideally, but as they exist) can fulfill the tasks assigned them by such formal rules.

Is Congress, for example, prepared to fully internalize all the cost and effort involved in the minutiae of budget preparation? Will it be nimble enough to adjust spending plans quickly, say within a year, in case of revenue shortfalls and delays in the implementation of spending? Or can the Executive and the bureaucracy improve their effectiveness enough to work according to the sluggish clock that Congress is inevitably bound to follow?

Now that lawmakers’ “pork” is gone and real political parties are nowhere on the horizon, what are the means to induce Congress to deliver budgets in a timely way? Shall we return (oh no!) to prolonged spells of reenacted budgets? If fiscal uncertainty is the result, what would be the effect on long-term growth and the people’s welfare?

Citoyens et citoyennes! We are in the midst of a revolution whose outcome is yet unknown — instigated ironically by a conservative and literalist Supreme Court. In a world of institutional dissonance, an insistence on strict formal rules can be disruptive. Indeed, seasoned union organizers know how a “work-to-rule” strategy can totally subvert production.

In a good scenario, all will turn out for the best. There may be a growth hiccup or two in the near term, but ultimately members of Congress will up their game and find common ground with some presidential vision and each puts his shoulder to the wheel. The exigencies of the situation may yet provide the needed spark for the formation of genuine program-based political parties.

The media and the growing middle class may yet become more focused on the quotidian business of politics and representation, progressing beyond their currently sporadic, scandal-driven interest. In short, the insistence on rules may yet provide a bridge to the country becoming a mature representative democracy. Who knows? The political class may yet “level up.”

As for the bad scenario… well, let’s not think about that right now. Let PNoy and Butch Abad worry about it.